THE FAS APPROVED TRASACTION IN THE MARKET OF INNOVATIVE NICOTINE-CONTAINING PRODUCTS

FAS approved conclusion of a joint venture agreement between Philip Morris products S.A. and Korean company KT&G Corporation

The agreement concerns the joint sale of innovative nicotine-containing products (heated tobacco products and devices for their consumption) under the KT&G brands in the Russian Federation.

The transaction is approved with behavioral conditions. Together with the approval decision, the antimonopoly authority issued an order to the parties to the transaction aimed at ensuring competition in this market.

“When making a decision, of course, we took into account the fact that Philip Morris is one of the largest companies in the market for both tobacco and innovative nicotine-containing products in the world and in Russia. The increase in the company's market power is compensated by the restrictions imposed by the antimonopoly authority,” said Vladimir Mishelovin, Head of the Fiscal Control Department of the FAS Russia.

The representative of the antimonopoly authority also noted that taking into account the features of strict state regulation of the industry, the main tools of competition for economic entities in the near future it will be the price factor and the novelty of the product. The emergence of a new product in the market will encourage other participants to create their products with better consumer properties, which will be safer for consumers.